The UCLA Anderson Forecast, which frankly has been unrelentingly gloomy about the state housing market for years, has suddenly dramatically changed their prediction for the state's home values, now projecting a 50% increase by 2017. (It should be noted that San Francisco median prices are far, far above the state's, and that the market in SF has been showing significant strength since 2011 began.)
“UCLA economists forecast that California home prices will rise steadily over the next six years, although the recovery in home sales isn’t projected to begin until 2013.
The UCLA Anderson Forecast predicted that the median price of an existing single-family home will increase 52.5% by 2017, rising to $438,980.
This year’s median house price is projected to be $287,904, down 0.3% from 2010.
But home prices are projected to turn around in 2012 — jumping 11.5% to $321,138 next year, then rising 10% more in 2013 to $353,411. The recovery is expected to run through 2017.
But house prices still will be below the housing market’s 2006 peak of $560,408 more than 10 years down the road, failing to retake that pinnicle by 2017.
The sales recovery won’t get under way until 2013, the statewide forecast shows. UCLA forecast that:
California home sales will drop to 483,132 single-family home transactions in 2012, down 1.4% from this year’s projected level of 490,137.
Sales will climb from 2013 through 2015, hitting a high-water mark of 547,945 transactions that year.
By 2017, however, sales will settle back to 507,842 transactions — just 3.6% higher than this year’s projected total.
By comparison, California house sales totaled nearly 625,000 transactions a year in 2004 and 2005.”